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Tiscali Operating Loss Widens

MILAN -- Italian Internet service provider
Tiscali
SpA reported a wider loss before interest and taxes for the second quarter after a sharp slowdown in acquiring new broadband customers.

Tiscali had been due to publish its results early on Friday but brought them forward after nagging financial worries sent its shares tumbling more than 9% on Thursday to their lowest level since its 1999 listing.

Tiscali's loss before interest and taxes was &euro;397 million ($479 million), widening from last year's &euro;32.6 million loss and a loss of &euro;27.2 million the preceding quarter.

Tiscali reported revenue of &euro;272.6 million, up 25% from last year's &euro;217.2 million.

The company said its new customers for the period were 200,000, after touching a record 400,000 increase in the first quarter. Tiscali said it had 1.44 million broadband users at the end of June, and it increased its year-end target to 1.7 million users from 1.6 million.

The company added that its cash burn reached &euro;28.9 million, meeting its target of halving its cash burn from the first quarter.

Tiscali shares closed down 9.1% on Thursday at &euro;2.45 on the Milan stock exchange.

Since January, market talk of possible cash and accounting problems has halved the value of Tiscali's stock, despite the company's denials.

Tiscali gave no fresh details of a capital increase of up to 10% of its existing share capital expected to go through before the end of the year.

But it said that it planned asset sales of &euro;250 million to help pay for a bond of that value due in July 2005.